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NEW YORK — Wall Street drifted in search of a direction Thursday, finishing lower, with inflation concerns and a disappointing earnings report from Viacom Inc. prompting investors to collect profits. A sharp drop in oil prices helped stocks mitigate the losses.

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Investors grew jittery as
the latest unemployment figures
showed strength in the labor market. First-time jobless claims fell by 20,000 from the previous week to 278,000 — a far sharper drop than economists had expected.

While a strong labor market is generally good news, Wall Street remains concerned that the additional buying power that comes with steady employment could push prices higher and spark inflation, prompting the Federal Reserve to keep hiking interest rates.

Still, investors were pleased with a drop in oil prices, which at one point dipped below $60 per barrel in trading on the New York Mercantile Exchange after the Energy Department reported a rise in crude oil stockpiles.

“Certainly the move in oil is good, and the market certainly perked up somewhat after that inventory report,” said Peter Cardillo, chief strategist and senior vice president at S.W. Bach & Co. “For the intermediate term, there doesn’t seem to be a supply/demand problem out there. But you don’t know when that’ll change.”

The Dow Jones industrial average finished the day down 68 points, or 0.6 percent, while the broader Standard & Poor’s 500-stock index declined 5 points, or 0.4 percent. The technology-rich Nasdaq composite index gave up 4 points, or 0.2 percent.

Bonds fell, with the yield on the 10-year Treasury note climbing to 4.57 percent from 4.53 percent late Wednesday. The dollar was mixed against most major currencies, while gold prices rose.

Stocks remain near 4½-year highs, but there was nothing in the day’s news to prompt investors to push prices even higher, despite the move in oil. With the Fed’s interest rate policy still in flux, the markets could be stuck in a modest range for the short term.

“It’s very difficult for investors to extrapolate anything from these short-term moves in the market,” said Christopher Conkey, chief investment officer at Evergreen Investments. “Don’t get too excited about days like yesterday, and don’t get too excited about days like today, either.”

In its first earnings report since spinning off CBS Corp.,
Viacom Inc. said its fourth-quarter profits fell
due to poor performance at its Paramount movie studio arm as well as one-time charges related to the company’s reorganization. Viacom fell 95 cents to $41.01.

Home builder Toll Brothers Inc. rose $1.49 to $33.98 after
the company said fourth-quarter profits jumped 49 percent
and that its backlog of building projects rose 22 percent by the end of the quarter. However, the number of new contracts fell 21 percent, raising new concerns about a softening housing market.